Digital Transformation of Health Insurance Services in A Developing Country: An Institutional Theory Perspective

Abstract

Structurally, the health system comprises different sub-sectors within the economic system, including healthcare providers, insurance organisations, and pharmaceutical companies. The health insurance organisation is at the nexus of this triad, bridging access to healthcare services. To improve access to healthcare delivery, several developing countries have tried to digitalise their health insurance system with some transformational outcomes. However, in sub-Saharan Africa (SSA), for example, operational challenges have been identified as impeding the successful evolution of public health insurance. These include low penetration due to limited enrollment, escalating costs from multiple instances of fraud, delays in reimbursement, overcrowding at facilities, and a prevailing reliance on manual and paper-based processes. Digitalisation is acknowledged as a catalyst for digital phenomena, facilitating organisations in their quest to navigate the process of digital transformation. The digital transformation of health insurance services goes beyond acknowledging just the changes that digital technologies bring. It considers the multifaceted social system requiring institutional perspective to chronicle the complex interactions between sociotechnical elements in the implementation system, the work system, the organisation, and the institutional environment. However, while this complexity has been acknowledged, it is vastly underestimated and empirically undocumented. Then again, despite health insurance’s growing importance, studies on developing, adopting, and using digital technologies and digital transformation in health insurance have remained predominantly non-IS. Moreover, regarding domain specificity, a blurred distinction exists between healthcare and health insurance, with the health system triad's nexus (health insurance) attracting limited to no research attention. Information systems’ limited exploration of the subject has also been atheoretical and on adoption at the individual unit of analysis. Therefore, this study aims to understand the digital transformation of health insurance services and the influence of the institutional environment in a developing country context. In so doing, the study sought to answer the following research questions: 1) Why might a developing country pursue digital transformation within the health insurance sector, and what meanings do health insurance organisations associate with the digital transformation of health insurance services? 2) how is the institutionalisation of digital transformation enacted in public and private sector health insurance organisations? 3) how does the institutional context influence the digital transformation of health insurance services and vice versa? 4) what are the outcomes of the digital transformation of health insurance services in a developing country? To achieve the study’s purpose, this research consolidates two analytic frameworks from institutional theory: institutional pillars analytic framework (regulative, normative, and cultural cognitive) and the institutionalisation process approach made up of deinstitutionalisation and reinstitutionalisation. The thesis used an IS interpretive qualitative case study as a methodology. Through purposive sampling, data was gathered from two cases of the National Health Insurance Scheme (public insurer) and Alpha Private Health Insurance Scheme (pseudonym, private health insurance organisation) in Ghana. A thematic analysis was conducted on data from the two cases to generate themes from the case description, followed by a theory-driven analysis based on the concepts and principles of combined institutional theory analytic frameworks. The findings show that a developing country would digitally transform health insurance services to 1) ensure operational efficiency and transformation, 2) improve service delivery, and 3) drive data-driven decision-making. However, from an institutional perspective, interpreted through the lens of how health insurance institutions—both public and private—conceive, implement, and adapt to change, two different meaning frames underpin this outcome. For public health insurance, these are 1) conformance to regulatory standards and social norms, 2) public good and equity, and 3) institutional isomorphism. For private health insurance, these are 1) competitive advantage, 2) market expansion and segmentation, 3) risk management and cost reduction and 3) innovation and differentiation. This demonstrates that actors operating within a public sector institutional framework are motivated by a “social logic” that prioritises equity. Conversely, actors within a private sector institutional framework are driven by a “market logic,” focusing on profit maximisation. In terms of how the institutionalisation of digital transformation is enacted in public and private sector health insurance organisations, this study shows a decoupling of deinstitutionalisation and reinstitutionalisation culminating in five enactment phases or SCOPE. These are 1) Scrutinise phase [assessment of the existing institutional environment], 2) Clarify phase [identification of issues and initiation of deinstitutionalisation], 3) Organise [strategy and planning for digital transformation], 4) Perform [implementation and reinstitutionalisation] and Enhance [ongoing adjustments]. Regarding how the institutional context influences the digital transformation of health insurance and vice versa, the study shows a co-shaping relationship between institutional elements and digital transformation with the influence of normative, regulative, and cultural cognitive institutional elements imposing different levels of impact. Finally, regarding the outcomes of the digital transformation of health insurance in a developing country, the study shows institutions as a significant driver of digital transformation and the emergence of a fourth pillar of institutions, i.e., technology. The study makes the following contributions regarding theory, research, practice, and policy. Theoretically, this study refines the two analytic frameworks of institutional theory: the institutional pillars and the institutionalisation process. For the institutional pillars, this study refines the three pillars by introducing elements that make up a fourth pillar of technology that is crucial in understanding the interplay of digital transformation within institutional environments. This new pillar reflects the growing recognition that technology is not just an artefact but a fundamental aspect of modern institutional frameworks, influencing inscribed meanings, behaviour, policy, strategy, and structure within organisations. Secondly, the study refines the institutionalisation process approach by decoupling its two sub-processes, deinstitutionalisation and reinstitutionalisation, into five distinct but connected phases (SCOPE) of digital transformation. Hitherto, these were seen as black boxes limiting their practical application in organisation studies. In terms of research, this could be considered one of the initial attempts at IS interpretive qualitative research that seeks to extend the literature on the digital transformation of health insurance services from a multi-level perspective, involving both public and private sector health insurance in a single study. The study demonstrates that while the institutional environment may constrain organisations, they inversely catalyse an entity by triggering significant changes to its properties through combinations of information, computing, communication, and connectivity technologies. In terms of policy, this study offers developing countries, managers, and public and private sector health insurance decision-makers ample guidelines in formulating appropriate digital-first policies to drive digital transformation and edge them closer to attaining universal health insurance coverage. Significant contributions of this thesis include publications in five conference proceedings and the publication of one book chapter.